A federal judge in New York has dismissed a lawsuit charging the U.S. Green Building Council with deceiving consumers about the benefits of its LEED program. Henry Gifford, whose Brooklyn firmdesigns energy-saving heating and cooling systems, claimed that the USGBC had misled consumers in a press release in which it said that LEED-rated buildings use 25–30 percent less energy than other buildings. According to Gifford, the false statement has diverted customers from his firm, Gifford Fuel Savings, to LEED-accredited professionals, and harmed consumers “who may spend significant amounts of money on LEED certification but will not experience energy savings.”
The USGBC was elated by the dismissal of the case. “This successful outcome is a testament to our process and to our commitment to do what is right,” said Rick Fedrizzi, the organization’s president. “We’re grateful that the Court found in our favor so we can give our full attention to the important work before us.”
But the dismissal did nothing to settle the underlying claim—which is that the USGBC has misled consumers about the benefits of LEED. The issue before Judge Leonard Sand was whether Gifford had standing to sue, which, under the precedents cited by the court, required him to show either that USGBC is his direct competitor or that he has a “reasonable commercial interest that is likely to be damaged by the alleged false statement.”
As to direct competition, the judge found that Gifford and the USGBC operate in separate arenas, because the “USGBC does not provide clients with advice about energy-efficient design”—a fact that many observers of the green building field would say too narrowly construes LEED’s role. (As Gifford noted in his opposition to the motion to dismiss, he competes with the USGBC “in providing guidance to consumers about how to design and construct buildings that will conserve energy.”)
As to likely injuries, Gifford pointed to the decision by one New York developer, Steve Bluestone, to stop using Gifford and instead seek LEED certification for his projects. But the court found that Bluestone’s decision could not have been based on the USGBC press release, given that, according to Bluestone, he made the change “because everyone has heard of LEED, but not everyone has heard of Henry Gifford,” and because the developer will “get more credibility by simply saying we’re going to build a LEED-rated building.”
In other words, Gifford lacked standing because his former client never claimed to believe that LEED could produce dramatic energy savings—merely that it was a good marketing tool. Further, in its motion to dismiss, USGBC said, “the LEED certification process does not assess the actual environmental performance of any of the structures for which certification is sought or granted,” ironically echoing some of the program’s critics, and coming dangerously close to contradicting the press release that Gifford calls misleading.
Gifford’s attorney, Norah Hart, said there were no plans to appeal. She suggested that, as LEED becomes better known, judges might come to accept several arguments Judge Sand rejected this time around—namely that the USGBC does effectively provide design advice and therefore does compete with green building professionals who operate outside the LEED system.